Fugutive Rewards and the FSIA

Vladimiro Lenin Montesinos Torres served as an advisor to Peruvian President Alberto Fujimori and as the head of Peru’s National Intelligence System during the 1990s…. For decades journalists and politicians had been leveling accusations of corruption against Montesinos, but for a long time none of them stuck. Things began to change on the evening of September 14, 2000, when an opposition lawmaker aired on Peruvian national television a video showing Montesinos handing a bribe to a congressman-elect….Peruvian authorities seized from Montesinos more than 700 videotapes incriminating him in a host of crimes…. In October 2000, Montesinos slipped out of the country on a yacht bound for the Galapagos Islands, sailed on to Venezuela, and visited a plastic surgery clinic. Then he vanished…. Interim President Valentin Corazao issued Emergency Decree No. 049-2001, which established a five million dollar reward for accurate information enabling the authorities to locate and capture Montesinos… Enter the plaintiff. Jose Guevara had met Montesinos in Venezuela in mid-December 2000. Montesinos needed a safe-house, and Guevara agreed to provide it. Guevara also provided Montesinos with a security detail, which gave him complete knowledge of the fugitive’s whereabouts. Guevara was easier to track down than Montesinos. In June 2001, F.B.I. agents located and detained Guevara in Miami. The agents told him that the United States intended to pursue criminal charges against him unless he gave up Montesinos. They also reminded Guevara of Peru’s reward offer. Faced with a choice of jail time and loyalty to Montesinos or five million dollars and freedom, it did not take Guevara long to make up his mind. Guevara not only disclosed Montesinos’ hiding place and telephone number but also arranged to have him delivered into the hands of the Venezuelan intelligence agency. Montesinos was arrested as a result of the information Guevara provided and the assistance he rendered, but for reasons that it has not disclosed in this case Peru has refused to pay him the promised reward….

The location and capture of a fugitive by law enforcement officials of a country may be a sovereign act, but that is not what this case is about. Peru’s contractual offer of a reward did not promise that in return for the information it was seeking Peru would locate and capture Montesinos, and Guevara is not seeking to compel it to do so. All that Guevara is seeking is what Peru promised in the reward offer, which is that it would pay five million dollars to anyone who furnished information of the nature and quality that enabled Peru to capture Montesinos. The information that Guevara provided fit the requirements of the offer: it enabled Peru to capture Montesinos. The question in this appeal is whether Guevara can use the courts of this country to compel Peru to keep its contractual promise to pay him the money it offered…. Peru could have attempted to use its police and investigatory powers to search for Montesinos without offering money for information from anyone outside the government. However, Peru “did not have the resources or the … expertise,” it needed to get the job done. After the trail ran cold, Peru “ventured into the marketplace,” to buy the information needed to get its man. Guevara provided that information for a price, the price being the five million dollars that Peru had offered to pay for it. The underlying activity at issue–the exchange of money for information–is “commercial in nature and of the type negotiable among private parties….

Although our decision is not based on policy grounds, we think it worth noting that this is an instance in which the result the law requires coincides with good policy. Accepting Peru’s position, dressed though it is in the clothing of sovereignty, would frustrate rather than further the ability of countries to carry out their sovereign functions. Anything that makes it easier for countries to welch on their promises to pay for information decreases the real value of any reward they offer and makes it less likely that an offer will be accepted. As Guevara has learned up to this point in the litigation, the promise of a multimillion dollar reward means little or nothing to an informant if the country offering the reward cannot be made to pay it. The holding Peru asks us to reach would jeopardize not only its vital interests but those of every country that offers rewards for information, including this country.”